Which states have best 529 plans?

Best 529 college savings plans
  • my529 (Utah)
  • Bright Start College Savings Program (Illinois)
  • CollegeAdvantage (Ohio)
  • Michigan Education Savings Program.
  • ScholarShare 529 (California)

Does it matter which state 529 plan?

529 plans are state-sponsored, but you can pick a plan from any state. Most states offer at least one 529 plan. You don’t have to invest in your own state’s plan; though many states offer residents a state tax deduction for doing so, there is no federal tax deduction for 529 contributions.

Which 529 plan performs the best?

Top 10 performing 529 college savings plans
Rank State Plan
1 South Dakota CollegeAccess 529 (Direct-sold)
2 Alaska Alaska 529
2 Alaska T. Rowe Price College Savings Plan
4 Nevada USAA 529 College Savings Plan
Nov 22, 2021

Why is Utah 529 the best?

Utah 529 Plan (My529)

This stands as one of the highest allowed 529 contributions in the country. And once you reach that level, your money still grows tax-free. Utah residents in particular may take a 5% income tax credit on their contributions up to a certain limit.

What happens to 529 if you move states?

Even if you’ve moved to a new state, you might not need to transfer your 529 plan to that state. You can keep the money in the old state’s 529 plan. A 529 plan can be used to pay for college in any state. … Some states provide a state income tax break on contributions to any state’s 529 plan.

Can I invest in out of state 529?

You can use a 529 plan from any state to pay for an eligible college in any state. … You might, however, wish to direct new contributions to the new state’s 529 plan to take advantage of the state income tax breaks on contributions to the state’s 529 plan.

Is the Utah 529 plan good?

UESP, Utah’s official nonprofit 529 college savings plan, is highly ranked by Morningstar Inc., Kiplinger’s Personal Finance magazine, Money magazine, CBS MoneyWatch.com, and consumer expert Clark Howard for its low fees and industry innovations such as its customized allocation investment options.

Are 529 tax deductible in Utah?

Contributions to the Utah 529 plan of up to $2,130 in 2022 per beneficiary by an individual, and up to $4,260 in 2022 per beneficiary by a married couple filing jointly, are eligible for a 4.95% credit against Utah income tax. … Contributions to an account established after a beneficiary reaches age 19 are not eligible.

How much can a parent contribute to a 529 per year?

In either case, parents receive the same treatment as any other person making a contribution: each parent can give up to $15,000 annually to their child’s 529 plan without having to file a gift tax return, for a total of $30,000 per year.

Is USAA 529 plan good?

Overall, the USAA 529 College Savings Plan is above average in performance, ease of setting up and use, and customer service.

Does Texas have a state 529 plan?

The Texas College Savings Plan (The Texas 529 Savings Plan)

A choice of savings options, Tax-free growth for your investment, and. Tax-free withdrawals on earnings used for qualified higher education expenses, including books, room and board, transportation and more.

Is it better for a parent or grandparent to own a 529 plan?

How Grandparent 529 Plans Affect Financial Aid. Overall, 529 plans have a minimal effect on financial aid. But, the FAFSA treats parent-owned accounts more favorably. For example, you report 529 plans assets as parent assets, which can only reduce aid eligibility by a maximum 5.64% of the account value.

How much can a grandparent give to a 529 plan?

The principal and earnings from a 529 plan are not taxed, so long as the money is used to pay for qualified educational expenses. Any person can give any other individual up to $15,000 in 2021 without paying a gift tax.

What is the max 529 contribution for 2021?

$15,000 per
In 2021, that means you can contribute up to $15,000 per beneficiary ($30,000 per married couple) to a 529 plan without having to pay gift taxes.

What are the disadvantages of 529 plan?

Disadvantages of 529 Plans
  • Limited Investment Options.
  • The Fees May Be High.
  • A 10% Penalty Applies to Non-Qualified Withdrawals.
  • Time Isn’t Always On Your Side.

Can you lose money on a 529 plan?

You don’t lose unused money in a 529 plan. The money can still be used for post-secondary education, for another beneficiary who is a qualified family member such as younger siblings, nieces, nephews, or grandchildren, or even for yourself.

How do I pay college tuition with a 529 plan?

You can call your plan administrator, make a request online, or submit a withdrawal request form. The plan can send withdrawals by check to the account owner, the beneficiary, or the school. You can transfer the money to yourself or the beneficiary electronically and then make payment to the school.

Why is a 529 plan a bad idea?

The rules on 529 plans are strict. The most important one is this: you must use funds in a 529 account to pay for qualified educational expenses. Otherwise, you’ll owe taxes on the investment gains at whatever the IRS would normally charge you plus an additional penalty rate of 10 percent.